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Quanta Services Inc (NYSE:PWR)
Beneish M-Score
-2.33 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Quanta Services Inc has a M-score of -2.33 suggests that the company is not a manipulator.

PWR' s 10-Year Beneish M-Score Range
Min: -3.06   Max: -1.58
Current: -2.33

-3.06
-1.58

During the past 13 years, the highest Beneish M-Score of Quanta Services Inc was -1.58. The lowest was -3.06. And the median was -2.43.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Quanta Services Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.0464+0.528 * 1.0299+0.404 * 0.9193+0.892 * 1.2037+0.115 * 1.02
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1973+4.679 * -0.0018-0.327 * 1.0641
=-2.33

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $1,813 Mil.
Revenue was 2052.982 + 2171.144 + 1864.55 + 1762.574 = $7,851 Mil.
Gross Profit was 327.03 + 352.971 + 281.448 + 272.071 = $1,234 Mil.
Total Current Assets was $2,554 Mil.
Total Assets was $6,312 Mil.
Property, Plant and Equipment(Net PPE) was $1,480 Mil.
Depreciation, Depletion and Amortization(DDA) was $194 Mil.
Selling, General & Admin. Expense(SGA) was $722 Mil.
Total Current Liabilities was $1,137 Mil.
Long-Term Debt was $72 Mil.
Net Income was 66.576 + 94.648 + 81.082 + 54.408 = $297 Mil.
Non Operating Income was -0.466 + -0.378 + -1.233 + 0.643 = $-1 Mil.
Cash Flow from Operations was 273.301 + 64.119 + 32.756 + -60.533 = $310 Mil.
Accounts Receivable was $1,439 Mil.
Revenue was 1817.623 + 1645.132 + 1474.377 + 1585.71 = $6,523 Mil.
Gross Profit was 302.843 + 273.053 + 241.284 + 238.273 = $1,055 Mil.
Total Current Assets was $2,313 Mil.
Total Assets was $5,793 Mil.
Property, Plant and Equipment(Net PPE) was $1,206 Mil.
Depreciation, Depletion and Amortization(DDA) was $162 Mil.
Selling, General & Admin. Expense(SGA) was $501 Mil.
Total Current Liabilities was $1,042 Mil.
Long-Term Debt was $1 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1812.539 / 7851.25) / (1439.115 / 6522.842)
=0.23085993 / 0.22062699
=1.0464

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(352.971 / 6522.842) / (327.03 / 7851.25)
=0.16180876 / 0.15711129
=1.0299

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2553.976 + 1480.128) / 6312.024) / (1 - (2313.318 + 1205.608) / 5793.245)
=0.36088583 / 0.39258119
=0.9193

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7851.25 / 6522.842
=1.2037

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(161.625 / (161.625 + 1205.608)) / (194.017 / (194.017 + 1480.128))
=0.11821321 / 0.1158902
=1.02

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(722.038 / 7851.25) / (501.01 / 6522.842)
=0.09196472 / 0.07680854
=1.1973

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((72.489 + 1137.325) / 6312.024) / ((1.053 + 1042.467) / 5793.245)
=0.19166816 / 0.18012703
=1.0641

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(296.714 - -1.434 - 309.643) / 6312.024
=-0.0018

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Quanta Services Inc has a M-score of -2.33 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Quanta Services Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.09231.10051.0510.77640.9861.0181.08390.98010.98351.0464
GMI 0.80660.93270.91830.96120.9391.10121.21270.84560.97891.0299
AQI 0.92260.80662.01840.94380.94431.04110.99950.86741.06610.9193
SGI 1.13261.14511.2591.42330.87781.09381.15551.41171.10181.2037
DEPI 0.98661.01181.33160.83411.18470.9611.03630.98211.11011.02
SGAI 0.95940.85011.05260.90391.15040.90090.94970.91191.04561.1973
LVGI 0.97021.00220.58280.60650.93690.76261.4421.03121.05091.0641
TATA -0.0342-0.0295-0.0244-0.024-0.0523-0.0186-0.01810.0386-0.027-0.002
M-score -2.56-2.48-1.78-2.34-2.89-2.31-2.37-2.08-2.53-2.33

Quanta Services Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.04920.98010.87170.90790.83190.98351.07871.09521.09351.0464
GMI 0.91670.84560.90380.89660.91310.97890.98571.02031.02621.0299
AQI 0.90720.86740.87530.8761.02231.06611.09241.08340.92240.9193
SGI 1.36131.41171.32171.2411.19671.10181.08461.13161.1941.2037
DEPI 1.02170.98210.98971.00711.03471.11011.08431.0391.00261.02
SGAI 0.83540.91190.98961.03881.03741.04561.14761.1061.15871.1973
LVGI 1.3691.03121.00380.91810.87851.05091.05221.06551.10751.0641
TATA 0.03460.03940.02430.019-0.0084-0.027-0.01210.00450.0075-0.0018
M-score -2.12-2.08-2.30-2.34-2.50-2.53-2.39-2.24-2.27-2.33
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